Correlation Between Fidelity Contrafund and Fidelity Blue
Can any of the company-specific risk be diversified away by investing in both Fidelity Contrafund and Fidelity Blue at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Fidelity Contrafund and Fidelity Blue into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Fidelity Contrafund and Fidelity Blue Chip, you can compare the effects of market volatilities on Fidelity Contrafund and Fidelity Blue and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Fidelity Contrafund with a short position of Fidelity Blue. Check out your portfolio center. Please also check ongoing floating volatility patterns of Fidelity Contrafund and Fidelity Blue.
Diversification Opportunities for Fidelity Contrafund and Fidelity Blue
0.98 | Correlation Coefficient |
Almost no diversification
The 3 months correlation between Fidelity and Fidelity is 0.98. Overlapping area represents the amount of risk that can be diversified away by holding Fidelity Contrafund and Fidelity Blue Chip in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Fidelity Blue Chip and Fidelity Contrafund is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Fidelity Contrafund are associated (or correlated) with Fidelity Blue. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Fidelity Blue Chip has no effect on the direction of Fidelity Contrafund i.e., Fidelity Contrafund and Fidelity Blue go up and down completely randomly.
Pair Corralation between Fidelity Contrafund and Fidelity Blue
Assuming the 90 days horizon Fidelity Contrafund is expected to generate 1.42 times less return on investment than Fidelity Blue. But when comparing it to its historical volatility, Fidelity Contrafund is 1.19 times less risky than Fidelity Blue. It trades about 0.1 of its potential returns per unit of risk. Fidelity Blue Chip is currently generating about 0.11 of returns per unit of risk over similar time horizon. If you would invest 11,498 in Fidelity Blue Chip on August 24, 2024 and sell it today you would earn a total of 10,781 from holding Fidelity Blue Chip or generate 93.76% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Strong |
| Accuracy | 100.0% |
| Values | Daily Returns |
Fidelity Contrafund vs. Fidelity Blue Chip
Performance |
| Timeline |
| Fidelity Contrafund |
| Fidelity Blue Chip |
Fidelity Contrafund and Fidelity Blue Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Fidelity Contrafund and Fidelity Blue
The main advantage of trading using opposite Fidelity Contrafund and Fidelity Blue positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Fidelity Contrafund position performs unexpectedly, Fidelity Blue can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Fidelity Blue will offset losses from the drop in Fidelity Blue's long position.| Fidelity Contrafund vs. Fidelity Low Priced Stock | Fidelity Contrafund vs. Fidelity Growth Pany | Fidelity Contrafund vs. Fidelity Magellan Fund | Fidelity Contrafund vs. Fidelity Diversified International |
| Fidelity Blue vs. Fidelity Otc Portfolio | Fidelity Blue vs. Fidelity Contrafund | Fidelity Blue vs. Fidelity Growth Pany | Fidelity Blue vs. Fidelity Growth Strategies |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
Other Complementary Tools
| AI Portfolio Architect Use AI to generate optimal portfolios and find profitable investment opportunities | |
| Money Flow Index Determine momentum by analyzing Money Flow Index and other technical indicators | |
| Content Syndication Quickly integrate customizable finance content to your own investment portal | |
| Bonds Directory Find actively traded corporate debentures issued by US companies | |
| Insider Screener Find insiders across different sectors to evaluate their impact on performance |